Recessions and with a volatile market, which is what we are experiencing currently because of the coronavirus (COVID-19) pandemic, can be very difficult for businesses. There’s uncertainty in a lot of aspects with a number of people losing their livelihood. There’s a direct hit that is felt in the cash flows of businesses; however, it does not have to be bad.
Current businesses are now finding ingenious methods in pivoting their business models, developing new forecasts, and revisiting their budgets in order to minimize the burn rate and also maximize whatever cash is available. Businesses in the UAE, in particular, are surviving and finding a lot of ways in thriving. But, for those who are looking into starting a business, it is a great time to do so!
By leveraging a rather lean planning system, business setup in UAE during a downturn will potentially help you, an investor and/or entrepreneur, in capitalizing on the weak economy. You will also avoid the difficulties that are affecting most businesses nowadays. In order to help you in getting started, we have listed the things that you should remember in order to be successful at the business setup in the UAE during a recession.
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Look for Solutions to New Problems
Difficult economic times often lead to the rise of new problems. The problems stem from pain or current need which does not have a solution that’s readily available. Understanding how consumers are handling this issue as well as who provides the solution which is best as of now will help you define as to why they would be switching to your business.
We suggest you focus on positioning the new business you want to start, the service, or the product as the better and newest solution. Even when there’s a lot of substitutes that are available, you have to present that your solution would prove to be reliable, affordable, and more immediate. With COVID-19, the best way for you to possibly approach your latest business idea would be starting with delivery, remote, or as a service variation to a service or product that has not been pivoted effectively in the market.
Cheaper, Faster or Better
There is a great chance that you will be starting your business operations from home or a Flexi-desk. You may also have minimal employees as well as little overhead in maintaining at this point. This combination places the business in an excellent position in providing an inexpensive solution, as well as winning over customers. With an economic downturn that we are all experiencing today, consumers and businesses alike are in search of ways in cutting costs, allowing you to be able to step in.
If you are able to save people money and combine these cost savings with better service and/or quicker turnaround time, then there is a great chance that you will turn the clients you are entertaining now as long-term and repeat customers. You’ll be able to establish a long-lasting relationship with them as one of the many reasons they’re able to survive the crisis is because of your business. This potentially turns them into loyal customers and advocates of your business. When the economy slowly recovers, you’ll then be able to increase the prices of your goods or services or even add new services or products that customers will be willing to accept as you’ve helped them before.
Make Room for More Competitors
If you have been wanting to undergo business setup in UAE but you’ve always thought the local market was too crowded or competitive, it is the ideal time for you to enter the industry. Small and large companies alike are struggling in adjusting and surviving in different methods during a crisis. This means the market and your competition is vulnerable to a brand new entrant. With the acquisition of competitive customers, see if you will be able to leverage a lean position and begin by working remotely or from home. This way, there will a greater chance for your business to weather any economic storm.
Possibly the most excellent thing that you can do in aggressively taking on your current competition is going out remotely and asking prospects what they feel with your competition serving the market during the crisis. Also, ask them what they wish the current company is doing differently. The answers to both of these questions will help you in better positioning yourself in avoiding mistakes of incumbents and providing a much better solution to the customers that are in need of your goods or services.
There are many more reasons and ways business setup in UAE can thrive even with an economic downturn. If you want to know how to set up a business in Dubai or any other emirate in the country, consult with FAR Consulting Middle East today!